Sava Insurance located in Waterford, CT

Business Directors and Officers

If your business is incorporated, does it have a board of directors and corporate officers?

Do you serve on a board of directors?

If the answer is yes to either question, you could be exposed to lawsuits from shareholders. They may sue you, alleging that you committed acts that reduced the corporation's value. Lawsuits may also arise out of employee practices, allegations of conflicting interests and from providing information to the investing public.

Decisions made by directors and officers impact the viability and value of a corporation. The current issues of accounting practices, financial reporting, and the use of corporate assets have resulted in an increase of lawsuits being filed against executive boards. Directors and Officers (D&O) coverage should be considered a necessity for corporate entities. D&O coverage supplements the protection provided by General Liability policies since the former responds to legal actions filed by shareholders, customers, scorned merger partners, and creditors.

Corporate directors must take steps to determine whether D&O coverage exists. If D&O coverage is in place, boards should also determine the amount of coverage available for handling defense costs. Any amounts paid for legal costs are subtracted from the overall policy limits and are not a separate coverage. Criminal acts are not covered by D&O Insurance. However, the cost of providing a legal defense until criminality is determined may be covered. In the past, it was common for a director facing a lawsuit to have any related expenses handled by a corporation's operating funds. Today, such agreements have little value, especially for operations facing bankruptcy or those that cease operation.

The increase in shareholder lawsuits has created a much tighter market, so the application is typically completed by one or two key executives. Both the applicant board and the insurance carrier rely upon the accuracy of the information provided by the persons completing the application. A problem arises because of how an insurer relies on the information. Typically, the insurer treats the information given by one or two persons as though it were received by all of the persons on the board. Insurers often either deny coverage or deny claims when there is evidence that the information is inaccurate. In other words, fraud or errors caused by an individual officer or director could eliminate coverage for all other directors and officers.

When coverage is not available or if it is denied, a director or officer may face the financial nightmare of having to handle his or her own legal expenses and costs of an award. Therefore, it is very important to take care that a D&O policy provides the anticipated protection. It is also important that a board takes steps to oversee the application process and to make sure that the provided information is accurate. Another step may be to look for D&O coverage that offers separate coverage to directors and officers so innocent parties do not have their protection stripped away due to the deliberate, false actions of others.

Please provide information about your business:

Small business quotations include property and liability coverage in one comprehensive package.

Contact Name: *

E-mail Address: *

Phone: *

Please describe your business: *

What is your business address? *

How many years have you been in business? *

What type of entity is the business? *

Please describe:

What is your expected revenue (sales) for the next 12 months? *

How many employees do you have? *

Please provide information about the property portion of the package:

Do you own the building you are located in? *

Please provide information about the building you occupy:

Have you made improvements to the building? *

Improvements can be adding permently attached shelving, flooring, etc.

What is the value of the improvements?

Please provide information about the building:

What is the amount of building coverage on your current policy?

Buildings will be quoted on a replacement cost basis.

Is there a mortgage on the building?*

Name and address of mortgage company:

Please provide general information about the building:

What year was the building built? *

Have you made improvements to the building? *

What is the value of the improvements?

Is there a mortgage on the building? *

Name and address of the mortgage company:

What year was the building built?

Describe any updates to roof, heating, and electrical systems: *

What is the construction of the building? *

Please describe: *

How far away is the building from a fire hydrant? *

What is the square foot area of the building? *

Indicate the square foot area for the portion of the buildng that you occupy:

Do you have a sign? *

Is the sign attached to the building?

What is the value of the sign?

The question regarding glass plates does not apply to Canada:

Does the building have glass plates?

This question does not apply to Canada:

Please provide the dimensions of the glass by plate:

Please provide information about the contents or inventory:

What is the value of your contents (including inventory)? *

Does your inventory value fluctuate more than 25% for a certain season? *

Do you have possession of property of others as a general course of business? *

Please describe: *

Please provide information about the liability portion of the package quote:

CANADIAN Businesses, what liability limit would you like us to quote?

Non-Canadian businesses, what liability limit would you like us to quote?

Would you like employee benefits liability included in the quote? *

Do you own any vehicles? *

Please provide information about your existing business insurance:

Please describe any claims you have had in the past five years:

Name of current insurance company:

Policy number:

Date coverage expires:

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How did you hear about us? *

Additional Information:

Comments or additional information:

Did You Know?

Fences are not included in most property policies without being separately scheduled.

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